UK’s BAME unemployment rate rises as unions call for furlough extension
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Zubair Karmalkar is a trainee reporter/researcher at International Employment Lawyer

The unemployment rate for black, Asian, and minority ethnic (BAME) workers has risen at three times the pace of white workers, official UK figures reveal, amid renewed calls for the chancellor to extend the government-backed furlough scheme beyond September.

Data from the Office for National Statistics (ONS) on the UK labour market, released 17 August, showed the unemployment rate for BAME workers has risen from 6.1% to 8% (a 31% increase) over the past year, with a marginal increase in unemployment among white workers from 3.6% to 4% (an 11% rise) over the same period.

In response to the figures, trade union body the TUC said inequalities in the UK labour market must be tackled by ministers taking “decisive action” to “challenge the discrimination that holds B[A]ME workers back”.

TUC General Secretary Frances O’Grady said: “B[A]ME workers have borne the brunt of the pandemic. They’ve been more likely to be in low-paid, insecure work and have been put at greater risk from the virus. They’ve also been more likely to work in industries that have been hit hard by unemployment, like hospitality and retail.”

O’Grady called for an extension of the government’s furlough scheme while the UK’s recovery from the covid-19 pandemic remains “fragile”.

“Instead of pulling the rug out from under the feet of businesses and workers, the chancellor must extend the furlough scheme for as long as is needed to protect jobs and livelihoods – and work towards setting up a permanent short-time work scheme to deal with future crises,” she said.

Since the furlough scheme began in spring 2020, the UK government has supported 11.6 million jobs by initially paying 80% of the wages of people who could not work, or whose employers could not afford to pay them, during the pandemic.

The government’s contribution has since been reduced to 60%, with employers paying 20% of salaries up to a monthly limit of £2,500. The scheme is set to end on 30 September.

The latest ONS figures also showed the number of people on zero-hour contracts has reduced slightly from 1.08 million in April-June 2020 to 917,000 in the same period of 2021, a reduction of 163,000.

Despite the dip in the number of zero-hours contracts, the TUC’s O’Grady said it was “shocking” that there are still just under a million people on such employment contracts.

“Many of these are the key workers who worked through covid-19, but still face the uncertainty of not knowing when their next shift will be,” she said.

A report published by the TUC and Race on the Agenda (ROTA) found that BAME women were twice as likely to be on low paid, insecure contracts compared to white men.

O’Grady once again called on the government to ban zero-hour contracts, saying: “Everyone deserves to be treated with dignity and respect at work.”

The ONS statistics also revealed there were an estimated 953,000 job vacancies, a record high, between May to July 2021, a 43.8% (290,000) growth compared with the previous quarter.

The increase in vacancies has experts warning that businesses may have to absorb higher costs as a shortage of workers are prompting employers to look for talent abroad.

Tim Hayes, a partner at BDB Pitmans specialising in employment and immigration law, said the new ONS statistics will come as little surprise to businesses who are struggling to recruit across a range of sectors.

“Much of the media focus has been at the lower end of the skills spectrum, and there are indeed rumours of the government making further tweaks to the immigration rules to ease the shortage of, for example, commercial drivers. However, we are seeing recruitment difficulties throughout the economy, including in the professions and for managerial positions,” he remarked.

“Employers are increasingly looking at either having to offer incentives and increase pay for candidates within the resident labour market or soak up the higher costs which now apply to bringing in talent from overseas.”